European Open Briefing

Global Markets:

  • Asian stock markets: Nikkei up 0.90 %, Shanghai Composite fell 0.10 %, Hang Seng rose 0.05 %, ASX 200 rallied 0.80 %
  • Commodities: Gold at $1243 (-0.30 %), Silver at $17.60 (+0.45 %), Brent Oil at $47.90 (+0.45 %), Brent Oil at $50.75 (+0.35 %)
  • Rates: US 10-year yield at 2.43, UK 10-year yield at 1.24, German 10-year yield at 0.43

News & Data:

  • New Zealand Trade Balance (NZD) (MoM) Feb: -18m (Est 180m) (Prior -285m)
  • Japan Nikkei Manufacturing PMI for March (preliminary): 52.6 (prior 53.3)
  • Japan manufacturers index +25 in March vs +20 in February
  • PBOC sets USD/CNY central rate at 6.8845 (vs. yesterday at 6.8856)
  • Fed’s Kaplan: Fiscal reforms could provide upside to growth forecast
  • Kaplan: Policies that slow work force growth would raise concerns
  • Kaplan: Making reasonably good progress on 2% inflation
  • Kaplan: We are approaching full employment
  • Dollar, stocks edge up as U.S. healthcare vote back on – RTRS

Markets Update:

The US Dollar recovered slightly in Asia. USD/JPY bounced once again off 110.60 support and rallied to 111.45. Resistance is noted at 111.60, followed by 112. The technical outlook remains negative, and selling interest on larger rallies is likely to be high. Much will depend on whether US President Trump will be able to pass his healthcare reform today. A failure would signal that it will be difficult to pass his tax reform as well. The announced tax reform is one of the major reasons why the US stock market and the Dollar rallied.

GBP/USD jumped above 1.25 yesterday, following stronger than expected retail sales data. Techs have turned positive and suggest the rally could continue to 1.27. Meanwhile, the Euro is coming under pressure again after the topside was capped at 1.0820 resistance. The upcoming French election still weighs on the currency.

Meanwhile, the Australian Dollar weakened amid the risk-off sentiment. AUD/USD fell to 0.7610 overnight and a break sub-0.76 would signal that another decline towards 0.75 is likely.

Upcoming Events:

  • 07:45 GMT – French GDP
  • 08:00 GMT – French Manufacturing PMI
  • 08:00 GMT – French Services PMI
  • 08:30 GMT – German Manufacturing PMI
  • 08:30 GMT – German Services PMI
  • 09:00 GMT – Euro Zone Manufacturing PMI
  • 09:00 GMT – Euro Zone Services PMI
  • 12:30 GMT – US Core Durable Goods Orders
  • 12:30 GMT – Canadian CPI
  • 13:05 GMT – FOMC Member Bullard speaks
  • 13:45 GMT – US Manufacturing PMI
  • 14:00 GMT – FOMC Member Dudley speaks
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